Eli James · The personal site of Cedric Chin, aka Eli James.

Cedric's Stupid Retirement Calculator

Upon retirement, I intend to have

SGD per month

as retirement income for

years

after I turn

Assuming terrible inflation of (avg over past 30 yrs is 1.83%)

% annually

And my current age of

years old

Then what I really need is around¹

0

SGD/mo after inflation

And what I need to have is

0

SGD saved up for retirement

Assuming I want to start investing with

SGD today

After reading the Investment Answer, I put my money in the following simple passive portfolio:

ETF Name

Percentage of Portfolio

Historical Average Annual Rate of Return

ABF Singapore Bond Index ETF A35.SGX

2.50% since fund inception, Aug 2005²

SPDR Straits Times Index ETF ES3.SGX

6.58% since fund inception, Apr 2002²

Vanguard FTSE All-World UCITS ETF (USD) VWRD.LSE

9.42% since fund inception, May 2012²

Total Portfolio Annual Return²:

0 %

²Obviously, past performance is not an indicator of future returns.

This means you will need to invest:

0

SGD per month

to achieve your goal.

You will end up with:

0

SGD

for retirement. =]

Notes

This portfolio shouldn't be the entirety of a retirement strategy. However, it's a simple starting point! If you're Singaporean, your CPF and any real estate you own will also contribute to your retirement planning. You may also supplement this ETF-based strategy with other instruments.

You shouldn't only look at the average rates of return. The Investment Answer urges you to think about your risk profile, and what kind of risks you are willing to be exposed to. Buying more VWRD, for instance, leaves you open to global market risk as well as currency risk of the USD.

This passive portfolio assumes you understand the ideas presented in The Investment Answer (aka passive investing). In order for this to work you will need to:

Rebalance your portfolio at least once a year, such that each component returns to the starting percentages. You do this by selling off the ones that do particularly well, or buying more of the ones that are doing poorly, until the $ value of each returns to the starting % of your overall portfolio.
Put in money at a certain interval (e.g. every quarter), rain or shine, stock market crash or bull rush.
You do this for a very long time, e.g. 3 decades or more.

This isn't professional financial advice. See the title of this page? It has 'stupid' in it for a reason! I wrote this to help me calculate my goals. I hope it helps you with yours!

PS: I repeat, this doesn't take into account CPF. Some Singaporean investors regard CPF as the bond component of their portfolio, and so reduce the % of the bonds component, above. Caveat emptor.

¹ What is this 'around' thing? Well, the inflation calculator sums up inflation as applied to your monthly retirement income goal for each year you plan to be retired. So if you intend to draw $2000 for 15 years at a 3% inflation rate, say, and your retirement age is 30 years from now, then in your first year the monthly income after inflation is $4854.52, and in your second year you will need $5000.16 per month after inflation, and so on. We take the average of this to present the monthly sum.